(Un)bundling Public-Private Partnership Contracts in the Water Sector : Competition in Auctions and Economies of Scale in Operation

In public-private partnership transactions in the water sector, one of the alleged concerns is that there is little market competition at the auction stage. This paper casts light on a tradeoff between the competition effect at the auction level an...

Full description

Bibliographic Details
Main Author:	Iimi, Atsushi
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ACCESS TO WATER ACCESS TO WATER SUPPLY COMMUNITY WATER COMPETITION IN WATER COMPETITIVE BIDDING COMPETITIVE BIDDING PROCESS CONSTRUCTION CUBIC METERS CUBIC METERS OF WATER LARGE URBAN AREAS LATIN AMERICAN LOCAL COMMUNITIES LOCAL WATER MARGINAL COST MIDDLE EAST MUNICIPAL WATER MUNICIPAL WATER SUPPLY NORTH AFRICA NUMBER OF CONNECTIONS NUMBER OF WATER NUMBER OF WATER CONNECTIONS POWER GENERATION PRIVATE PARTICIPATION PUBLIC WATER PUBLIC WATER UTILITIES REGIONAL DEVELOPMENT SANITATION SANITATION PROGRAM SANITATION SECTOR SANITATION SERVICE SANITATION SERVICE PROVIDERS SANITATION SERVICES SERVICE AREA SERVICE PROVISION SEWERAGE SEWERAGE CONNECTIONS SEWERAGE OPERATIONS SEWERAGE SECTOR SEWERAGE SERVICE SEWERAGE SERVICES SMALL CITIES SMALL-SCALE WATER SUB-SAHARAN AFRICA URBAN AREAS URBAN WATER URBAN WATER SERVICES URBAN WATER SYSTEM UTILITY SERVICES UTILITY SIZE WATER COMPANIES WATER CONNECTIONS WATER DISTRIBUTION WATER DISTRIBUTION NETWORK WATER DISTRICTS WATER OPERATORS WATER PRODUCTION WATER SALES WATER SECTOR WATER SERVICE WATER SERVICE OPERATORS WATER SERVICES WATER SUPPLY WATER SUPPLY SERVICES WATER SYSTEM WATER SYSTEMS WATER UTILITIES WATER UTILITY WATER VENDORS
Online Access:	http://documents.worldbank.org/curated/en/2008/01/8912687/unbundling-public-private-partnership-contracts-water-sector-competition-auctions-economies-scale-operation http://hdl.handle.net/10986/6457

id	okr-10986-6457
recordtype	oai_dc
spelling	okr-10986-64572021-04-23T14:02:30Z (Un)bundling Public-Private Partnership Contracts in the Water Sector : Competition in Auctions and Economies of Scale in Operation Iimi, Atsushi ACCESS TO WATER ACCESS TO WATER SUPPLY COMMUNITY WATER COMPETITION IN WATER COMPETITIVE BIDDING COMPETITIVE BIDDING PROCESS CONSTRUCTION CUBIC METERS CUBIC METERS OF WATER LARGE URBAN AREAS LATIN AMERICAN LOCAL COMMUNITIES LOCAL WATER MARGINAL COST MIDDLE EAST MUNICIPAL WATER MUNICIPAL WATER SUPPLY NORTH AFRICA NUMBER OF CONNECTIONS NUMBER OF WATER NUMBER OF WATER CONNECTIONS POWER GENERATION PRIVATE PARTICIPATION PUBLIC WATER PUBLIC WATER UTILITIES REGIONAL DEVELOPMENT SANITATION SANITATION PROGRAM SANITATION SECTOR SANITATION SERVICE SANITATION SERVICE PROVIDERS SANITATION SERVICES SERVICE AREA SERVICE PROVISION SEWERAGE SEWERAGE CONNECTIONS SEWERAGE OPERATIONS SEWERAGE SECTOR SEWERAGE SERVICE SEWERAGE SERVICES SMALL CITIES SMALL-SCALE WATER SUB-SAHARAN AFRICA URBAN AREAS URBAN WATER URBAN WATER SERVICES URBAN WATER SYSTEM UTILITY SERVICES UTILITY SIZE WATER COMPANIES WATER CONNECTIONS WATER DISTRIBUTION WATER DISTRIBUTION NETWORK WATER DISTRICTS WATER OPERATORS WATER PRODUCTION WATER SALES WATER SECTOR WATER SERVICE WATER SERVICE OPERATORS WATER SERVICES WATER SUPPLY WATER SUPPLY SERVICES WATER SYSTEM WATER SYSTEMS WATER UTILITIES WATER UTILITY WATER VENDORS In public-private partnership transactions in the water sector, one of the alleged concerns is that there is little market competition at the auction stage. This paper casts light on a tradeoff between the competition effect at the auction level and potential economies of scale in service operation. If the authorities design a large-scale public-private partnership water transaction, it is expected to exploit operational scale economies. But the competition effect may have to be sacrificed. The paper shows a risk that the selection of the contract size could be a very restrictive condition that excludes many prospective bidders. Moreover, the paper quantifies the optimal size of public-private partnership contracts in the sector by estimating a cost function. The analysis shows that economies of scale exist but tend to diminish quickly as production increases. When the amount of water sold exceeds about 40 million 2012-05-25T19:24:30Z 2012-05-25T19:24:30Z 2008-01 http://documents.worldbank.org/curated/en/2008/01/8912687/unbundling-public-private-partnership-contracts-water-sector-competition-auctions-economies-scale-operation http://hdl.handle.net/10986/6457 English Policy Research Working Paper; No. 4459 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ACCESS TO WATER ACCESS TO WATER SUPPLY COMMUNITY WATER COMPETITION IN WATER COMPETITIVE BIDDING COMPETITIVE BIDDING PROCESS CONSTRUCTION CUBIC METERS CUBIC METERS OF WATER LARGE URBAN AREAS LATIN AMERICAN LOCAL COMMUNITIES LOCAL WATER MARGINAL COST MIDDLE EAST MUNICIPAL WATER MUNICIPAL WATER SUPPLY NORTH AFRICA NUMBER OF CONNECTIONS NUMBER OF WATER NUMBER OF WATER CONNECTIONS POWER GENERATION PRIVATE PARTICIPATION PUBLIC WATER PUBLIC WATER UTILITIES REGIONAL DEVELOPMENT SANITATION SANITATION PROGRAM SANITATION SECTOR SANITATION SERVICE SANITATION SERVICE PROVIDERS SANITATION SERVICES SERVICE AREA SERVICE PROVISION SEWERAGE SEWERAGE CONNECTIONS SEWERAGE OPERATIONS SEWERAGE SECTOR SEWERAGE SERVICE SEWERAGE SERVICES SMALL CITIES SMALL-SCALE WATER SUB-SAHARAN AFRICA URBAN AREAS URBAN WATER URBAN WATER SERVICES URBAN WATER SYSTEM UTILITY SERVICES UTILITY SIZE WATER COMPANIES WATER CONNECTIONS WATER DISTRIBUTION WATER DISTRIBUTION NETWORK WATER DISTRICTS WATER OPERATORS WATER PRODUCTION WATER SALES WATER SECTOR WATER SERVICE WATER SERVICE OPERATORS WATER SERVICES WATER SUPPLY WATER SUPPLY SERVICES WATER SYSTEM WATER SYSTEMS WATER UTILITIES WATER UTILITY WATER VENDORS
spellingShingle	ACCESS TO WATER ACCESS TO WATER SUPPLY COMMUNITY WATER COMPETITION IN WATER COMPETITIVE BIDDING COMPETITIVE BIDDING PROCESS CONSTRUCTION CUBIC METERS CUBIC METERS OF WATER LARGE URBAN AREAS LATIN AMERICAN LOCAL COMMUNITIES LOCAL WATER MARGINAL COST MIDDLE EAST MUNICIPAL WATER MUNICIPAL WATER SUPPLY NORTH AFRICA NUMBER OF CONNECTIONS NUMBER OF WATER NUMBER OF WATER CONNECTIONS POWER GENERATION PRIVATE PARTICIPATION PUBLIC WATER PUBLIC WATER UTILITIES REGIONAL DEVELOPMENT SANITATION SANITATION PROGRAM SANITATION SECTOR SANITATION SERVICE SANITATION SERVICE PROVIDERS SANITATION SERVICES SERVICE AREA SERVICE PROVISION SEWERAGE SEWERAGE CONNECTIONS SEWERAGE OPERATIONS SEWERAGE SECTOR SEWERAGE SERVICE SEWERAGE SERVICES SMALL CITIES SMALL-SCALE WATER SUB-SAHARAN AFRICA URBAN AREAS URBAN WATER URBAN WATER SERVICES URBAN WATER SYSTEM UTILITY SERVICES UTILITY SIZE WATER COMPANIES WATER CONNECTIONS WATER DISTRIBUTION WATER DISTRIBUTION NETWORK WATER DISTRICTS WATER OPERATORS WATER PRODUCTION WATER SALES WATER SECTOR WATER SERVICE WATER SERVICE OPERATORS WATER SERVICES WATER SUPPLY WATER SUPPLY SERVICES WATER SYSTEM WATER SYSTEMS WATER UTILITIES WATER UTILITY WATER VENDORS Iimi, Atsushi (Un)bundling Public-Private Partnership Contracts in the Water Sector : Competition in Auctions and Economies of Scale in Operation
relation	Policy Research Working Paper; No. 4459
description	In public-private partnership transactions in the water sector, one of the alleged concerns is that there is little market competition at the auction stage. This paper casts light on a tradeoff between the competition effect at the auction level and potential economies of scale in service operation. If the authorities design a large-scale public-private partnership water transaction, it is expected to exploit operational scale economies. But the competition effect may have to be sacrificed. The paper shows a risk that the selection of the contract size could be a very restrictive condition that excludes many prospective bidders. Moreover, the paper quantifies the optimal size of public-private partnership contracts in the sector by estimating a cost function. The analysis shows that economies of scale exist but tend to diminish quickly as production increases. When the amount of water sold exceeds about 40 million
format	Publications & Research :: Policy Research Working Paper
author	Iimi, Atsushi
author_facet	Iimi, Atsushi
author_sort	Iimi, Atsushi
title	(Un)bundling Public-Private Partnership Contracts in the Water Sector : Competition in Auctions and Economies of Scale in Operation
title_short	(Un)bundling Public-Private Partnership Contracts in the Water Sector : Competition in Auctions and Economies of Scale in Operation
title_full	(Un)bundling Public-Private Partnership Contracts in the Water Sector : Competition in Auctions and Economies of Scale in Operation
title_fullStr	(Un)bundling Public-Private Partnership Contracts in the Water Sector : Competition in Auctions and Economies of Scale in Operation
title_full_unstemmed	(Un)bundling Public-Private Partnership Contracts in the Water Sector : Competition in Auctions and Economies of Scale in Operation
title_sort	(un)bundling public-private partnership contracts in the water sector : competition in auctions and economies of scale in operation
publisher	World Bank, Washington, DC
publishDate	2012
url	http://documents.worldbank.org/curated/en/2008/01/8912687/unbundling-public-private-partnership-contracts-water-sector-competition-auctions-economies-scale-operation http://hdl.handle.net/10986/6457
_version_	1764399983024406528

(Un)bundling Public-Private Partnership Contracts in the Water Sector : Competition in Auctions and Economies of Scale in Operation

Similar Items